Nialco Alloys has become the first company from the Small and Medium Enterprise or SME sector to get the approval of the Securities and Exchange Commission for public listing.
The firm will raise Tk 75 million capital from the stock market by selling 7.5 million shares at Tk 10 each, the SEC said in a statement after giving the nod in a meeting on Thursday.
The approval is expected to make the path easier for SME firms to expand business through public listing. The SEC had formed a SME Board for the trading of shares of small-cap firms.
The regulator said Nialco’s listing is not traditional initial public offering or IPO, meaning not all general investors can buy the shares of the firms.
Only eligible and institutional investors can invest in SME shares, which are considered risky.
Bangladeshi and foreign individuals with investment more than Tk 10 million as per market price can invest in the shares under the SME Board, reports bdnews24.com.
The approval is part of efforts to implement the government plan on long-term financing of the SME sector, according to the SEC.
Nialco will use the capital to develop land, purchase machinery and pay for the cost of the listing.
It cannot issue bonus shares for three years from the beginning of trading.
MTB Capital is the issue manager of Nialco, a producer of bronze, brass and gun metal.
Registered in 2011, the firm went into operation in 2015.
Its profit shot up to Tk 19.6 million in 2019 from Tk 1.47 million in 2018. The company posted a profit of Tk 15.1 million last year.
Gazi Mukarram Ali Chowdhury is chairman of the firm and its managing director is Kamal Uddin Ahmed.